After Apple removed Airfoil Speakers Touch from the iOS App Store and required its AirPlay functionality be removed, a customer emailed Tim Cook asking for clarification. Phil Schiller replied to that email, citing the guidelines:

Rogue Amoeba’s app added a feature that accessed encrypted AirPlay audio streams without using approved APIs or a proper license and in violation of Apple’s agreements. Apple asked Rogue Amoeba to update their app to remain in compliance with our terms and conditions.

However, Rogue Amoeba took issue with this categorization. As they point out, they could not use approved APIs, nor use disallowed APIs for AirPlay because there are no APIs for this specific AirPlay functionality. Rogue Amoeba wrote the code in-house. Likewise, they requested a license only to be told that the license only applies to hardware, not software.

This doesn’t mean Rogue Amoeba is innocent, however. Even though no software license exists to legitimately decrypt AirPlay streams, it doesn’t mean that RA has the authority or privilege to create such a license, especially if they wish to sell their product through a channel belonging to the company that issues those licenses.

I disagree with Apple disallowing this, though I can see why they did. There’s no question that it has been handled extremely poorly on their part.